PERERA v. PERERA et al

050-NLR-NLR-V-10-PERERA-v.-PERERA-et-al.pdf


( 230 )
Present: Mr. Justice Wood Renton.
PERERA v. PERERA et al.
G. R.t Pasyala, 3,292.
Lease — Clauseof forfeiture — Enforcement — Relief English Lavs
Roman-Dutch Late.
A clause of forfeiture in a lease – for non-payment of rent is onlyintended as security for the due payment of the rent; and bothunder the English Law and under the Roman-Dutch Law a lesseeis entitled to relief against such forfeiture, even where the lessor hasregained peaceable possession without the assistance of any Courtof Law.
A clause of forfeiture cannot be enforced, except by appropriatejudicial proceedings, in the course of which it would be. competentfor the lessee to set up, as against his lessor or any one claimingunder him, all, equitable rights to compensation.
A
PPEAL from a judgment of the Commissioner of Requests(Peter de Saram, Esq.}.
The facts and arguments are fully stated in the judgment.
Bawa, for the plaintiff, appellant
Van Langenberg, for the defendants, respondents.
Cut. adv. vult.
8th July, 1907. Woon Renton J.—
In my opinion, this appeal must faril. The plaintiff-appellantsued the defendant-respondents to recover the sum of Rs. 70, beingthe value of the ground share of a crop of paddy removed by themfrom a land called Pillewa in the village of Bataliya. The owner ofthis land, ‘Paul Abraham Appuhamy, had leased it to the firstrespondent for five years from 18th April, 1902; and the second,,third, and fourth respondents were cultivators under the first. Thelease contained a clause of forfeiture in default of payment by thelessee of any of the yearly instalments ;by which the rent wasmade payable, and the lessor expressly reserved ‘to* himself thepower of “ releasing the lease after amicably settling the amountdue to the lessee, ” if he desired to sell the land. By deed of2nd December, 1905, Appuhamy sold the land to the appellant,frge from incumbrances, and without any reference to the firstrespondents lease. At the date of this sale the first respondent
1907.
July 8.
( 231 )
was in arrear with the payment of his rent*, but he alleges thatAppuhamy, on his side, was indebted to him for the value of im-provements. In view of the course that the case has taken, it isunnecessary for me to go into the state of accounts between theparties. On 4th December, 1905, Appuhamy wrote to the firstrespondent intimating to him that he had sold the land “ and theremaining term of the lease " to the appellant, and requesting him topay the rent to the appellant thenceforward. On the following daythe appellant, through his proctor, wrote both to the first respond-ent informing him of the sale and requiring him to pay the rent forthe then current month and to deliver up the premises on the 31stDecember, and also to the second, third, and fourth respondentsdemanding, by right of his purchase, the ground share of the exist-ing paddy crop. The first respondent, by proctor's letter dated24th January, 1905, agreed to deliver up possession on satisfactoryproof of the appellants title and to pay rent to the appellant up tothe date of such delivery. The appellant has obtained possession ofthe land. The paddy crop has, however, been reaped by the respond-ents. The appellant admits the claim of the second, third, andfourth respondents to the cultivators' share, and he sues only for theground share, which has been assessed by the Police Vidane ofBataliya and three minor headmen at Es. 70. The Commissionerof Bequests has dismissed the appellant’s action substantially on theground that the. first respondent's lease was still in force at the dateof the sale, and that therefore the appellant had no right to theground share of the crop, which appears from the evidence to havebeen sown about the. Sinhalese New Year, 1905, and to have beennearly ripe,in the following December.- In effect I think that thisdecision is sound, although 1 propose to state my own view of thelaw and the facts in somewhat different terms.
By his deed of sale the appellant acquired the rights of his vendorand nothing more. On 2nd December, 1905, the rent due by .thefirst respondent was .in arrear. It was, therefore, open to Appu-hamy at that date, if he had thought proper, to have .taken proceed-ings against .the respondent, in virtue of the forfeiture clause, for thecancellation of .the lease. It was open to him also to sell the landdemised. But under the lease he had no power, as between himselfand the first respondent, to execute any deed of sale which had theeffect of cancelling the lease, unless and until the amount, if any, due‘ by him .to the lessee had been settled. If it could be settledamicably, *good and well. There is no law to prevent a lessee fromsurrendering his lease. If not, it would have to be settled judiciallyin an action for cancellation. Appuhamy availed himself of neitherof the courses which I have indicated. He took no proceedingsunder the forfeiture clause. He made no proposal for a settlementof accounts. On the contrary, in his leter of 5th December, 1905,he tells the first respondent that he has sold the land and the residue
1907.
Jvly 8.
Woo©Rentok Jf
1907.
July 8.
WoodRenton J.
( 232 )
of the lease, and calls upon him to attorn to the appellant. Itfollows that at the date of the sale the first respondent was entitledas against A]5puhamy to the ground share of the growing crop, andthat the appellant can stand in no better position than his vendor.
It is true that the first respondent must be taken to have, by hisletter of 24th January, 1906, attorned tenant to the appellant untilthe delivery up of possession of the subject of the lease. But attorn-ment affects the landlord as well as the tenant. It involves, so longas the relationship lasts, an acceptance by the former of the rights ofthe latter under the lease: and in the present case one of those rights,as I have shown, was the right to the ground share of the paddy cropnow in dispute. An attempt was made at the trial to prove thatthe appellant had been in possession of the crop, by his watchers,since the beginning of January, 1906. The learned Commissioner ofRequests did not accept the evidence adduced by the appellant onthis point, and I see no indication on the face of the record of anyintention on the part of the first respondent,, while surrendering theresidue of his term, to abandon his rights as an outgoing tenantThe appellant, if so advised, may sue the first respondent for therecovery of any rent due to his vendor, and in such an action the ,question of compensation for improvements can be considered.But it is the clear right of the .first respondent, and even more clearlythe right of the other respondents, who are sued merely for the partthat they played in reaping the crop, to have this action dismissed,and I dismiss accordingly, with all costs heie and below.
I desire to add that, in my opinion, such a condition in a lease asexisted in the present case could not be carried out—otherwise thanby consent—except by appropriate judicial proceedings, in thecourse of which it would be competent for the lessee to set up, asagainst his lessor or any one claiming under him, all equitable rightsto compensation. I think that this view is supported both byEnglish and by Roman-Dutch Law, and as the question was arguedbefore me in the present case, and has frequently been touched uponin other cases, I propose to deal with it here. The Court of Equityin England was from an early period accustomed to grant reliefagainst the payment of the whole penalty on money bonds: and theStatutes 4 and 5 Ann. c. 16, ss. 12 and 18, and 8 and 9 Will. III.c. 11 conferred a similar jurisdiction on the Courts of Law. In thecourse of time this equitable jurisdiction was extended to forfeitureclauses in leases for non-payment of rent. This extension proceededt ok the. theory that the forfeiture clause—like the pepalty in thebond—was only a security for the recovery of money. . The Statue4 Geo. 2 Cr 28 recognized this jurisdiction, but limited (section 3)the time within which the lessee in default m*ght claim relief. Anattempt was at one time made to extend the jurisdiction in equity torelieve against forfeiture for non-payment of rent to breaches ofother conditions in leases, c.g., covenants to insure. But this was
( 283 )
effectually checked by the decision of Lord Eldon in Hill v. Barclay1 1907.and cf. Bowser v. Colby2 and Barrow v. Isaacs & Son* Lateron the Legislature interposed, and first the Court of Equity (22 and w ood28 Viet. c. 35, ss. 4—9) and afterwards Courts pf Law (23 and 24 Viet. Rbcteon J.c. 126) were enabled to grant relief against breaches of covenants toinsure if (a) no damage had resulted from the default, (b) the defaultwas due to accident or mistake, or in any event not to gross negli-gence on the part of the lessee, and (c) there was an adequateinsurance on foot at the time of the application to the Court. ThvConveyancing Acts, 1881 and 1892, have completed the work of theLegislature in developing this branch of the law; the former requiring(s. 14) a lessor before re-entry for breach of condition (other thannon-payment of rent) to notify the breach to the lessee and call uponhim to remedy it ; the latter conferring (s. 4) on sub-lessees anindependent right to relief (Gray v. Bonsall4) for breach of any ofthe conditions in the head lease. Non-payment of rent is still dealtwith by the Court in the exercise of its old equitable jurisdiction, andrelief has beeD granted' to a lessee even where—as in the casebefore, me in the present appeal—the lessor had regained peaceablepossession without the assistance of any Court of Law. From theforegoing survey it will be seen that in England both the Courtsand the Legislature have long been working steadily together(the Legislature stepping in where the arm pf equity or of lawwas shortened) to prevent the forfeiture of leases for breach ofcondition.
The same spirit is to be # found in Roman-Dutch Law. Voet (19,
2, 18) expressly declares that the tenants of rural and urban tene-ments are not to be ejected 'without judicial authority, and that thequestion of ejectment or damage is one that should be left entirelyto the discretion of a careful and circumspect Judge. The necessityfor judicial.authority for the cancellation of a lease results from thedecision in Silva v. Dasanayaka ;5 relief against forfeiture even foia careless omission to perform a. covenant has been granted (Pererav. Thalif;® and cf. Amarasinghe v. Segoe;7 D. C.t Kurunegala,
3,704 ;9 Siribohamy v. Rattranhamy ;9 while the rights of lesseesto compensation for improvements have been affirmed in a series ofdecisions, of which the latest is Mudianse v. Sellandyar,1(! a casein which the right was upheld even against third parties.
Appeal dismissed.
i (1811) 18 Ves. 56.
* (1841) 1 Hare 109.
8 (1891) 1 Q. B. 417.-4 (1904) 1 K. B. 601.
8 (1891) 1 C. L. R. 86.(1907) 10 V. L. R. 209.
• (1904) 8 N. L. R. 11S.
(1902) 2 Browne 397.
Ram. (1877) 254.
« (1898) 3 N. L. R. 248.